Tax Tips (and other stuff): Has your name changed? Make sure it is correct

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Now that the government is actually using computers to match information between agencies (Social Security, IRS, Dept. Of Homeland Security, DMV, etc.) a problem that is starting to pop up is mismatches due to various versions of the same person's name. Most involve a name change that is related to a marriage or divorce.

If you want your Social Security benefits to start in the near future, or you want to have your tax return e-filed (so you can get your refund faster), or you want to renew your driver's license, or you want to purchase something that requires a credit check, or you don't want to run into trouble with airport TSA, etc., if your name isn't exactly correct, the computer being used may just reject whatever you are attempting to do. Sometimes it will say the reason (invalid name), other times, you won't know that this is the reason.

Let me give you an example. We recently had a new client come in to file a joint tax return with her husband. They had a large refund due. When we attempted to e-file their return, the IRS kept saying "invalid name." We had used the name she gave us (which was also the same one used on all their prior year tax returns). Next, we changed her name to match exactly what was on her Social Security annual report documents and it was rejected again. After sitting down with the client, we discovered that she had never actually officially changed her name with the Social Security Administration when she got married 13 years prior. The Social Security Computer's "official" record still had her maiden name.

Another horror story. Somebody worked for many years and then applied for Social Security benefits only to discover that she wasn't "qualified" due to the Social Security Administration not having any record of her earnings. The employer had used her nick name, and a wrong social security number. Way back (more than 20 years ago when she got married), she had not informed Social Security of her name change, there was no way to easily prove that her earnings were actually received so they could be used in computing her Social Security benefits. (This goes to show the importance of going over the annual report of wages you get from Social Security. If you are not getting that annual report, you should call the Social Security Administration and make sure they start sending it to you. Also, saving copies of all your old tax returns can help.)

If you have ever changed your name, the most important thing to do is to contact all appropriate government agencies and verify the spelling, etc. Social Security should be at or near the top of the first contact you make, then do the same with the DMV, your bank, stockbroker, pension plan administrator, employer, insurance agent, etc. Pay extra close attention to make sure there are no typos in the exact spelling of your full name and tax ID.

Someone once said, "A good name is to be chosen over great riches. It's tax free! ... so far."

• Kelly Bullis is a Certified Public Accountant in Carson City. Contact him at 882-4459.


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